Is it OK to Use Trade Marks in Adwords, Keywords and Metatags?

Is it OK to Use Trade Marks in Adwords, Keywords and Metatags?

Is it OK to Use Trade Marks in Adwords, Keywords and Metatags?

Trade marks can be used in hidden text 

In March 2016 Her Honour Justice Katzmann made it very clear that using a competitor’s trade mark in the unseen back end of your online advertising accounts is not a breach of trade mark law, nor is it misleading or deceptive. Veda Advantage Ltd v Malouf Group Enterprises Pty Ltd [2016] FCA 255.

Credit reporting company Veda Advantage (now Equifax) registered a string of trade marks including the name ‘Veda’.

Malouf Group Enterprises used 86 variations of the Veda trade marks in its online advertising to attract customers to its credit repair services. Most of Malouf’s advertising limited the use of the Veda trade marks to keywords selected in the back end of its Google Adwords campaigns.

Veda sued, relying on three main causes of action:

  1. Trade mark infringement within the meaning of s120 of the Trade Marks Act
  2. Misleading and deceptive conduct in contravention of s18 of the Australian Consumer Law
  3. Making false and misleading representations in contravention of s29(1)(h) of the Australian Consumer Law

Malouf was found to be innocent of any infringement or contravention where the keywords that resulted in the ads used Veda trade marks, and the ads themselves did not. We’ll get to why in a minute.

There were two other categories of ads. The first were ads that used the word “Veda” as a description, such as “Fix Your Veda File Now”, and the third potentially drew a link between Veda and Malouf’s business, showing the words “The Veda Report Centre”. Only the last category was a breach.

When is a trade mark, not a trade mark?

When it isn’t being used as a trade mark, and ‘use’ is quite specific.

In a clearly reasoned judgement, Her Honour stepped through the relevant law to conclude that:

When selecting keywords and including them in an Adwords campaign, the advertiser is not using those words to distinguish the goods or services from goods or services of another trader. The advertiser is using those keywords to identify internet users who might have an interest in the product or service.

All Adwords account users have the ability to use the same keywords at the same time, which adds weight to the argument that those keywords are not being used as trade marks.

Where the keywords used are “invisible and inaudible, indeed imperceptible, to consumers” their use cannot be as a trade mark to distinguish goods or services.

Where trade marks are used in a way that is merely descriptive of services, like “fix my Veda file”, that is not use as a trade mark.

In response to Veda’s argument that the use “in physical or other relation to the services” (from section 7 of the Act) did not have to be visible to the consumer, Her Honour responded “I doubt very much whether the Parliament had in mind a metaphysical relationship, no matter how expansive the concept of use was intended to be.”

YOU CAN’T INFRINGE TRADE MARKS IN METATAGS EITHER

In endorsing a decision of Complete Technology Integrations Pty Ltd v Green Energy Management Solutions Pty Ltd Her Honour agreed that metatags were:

  • invisible to the ordinary internet user
  • used by search engines to direct a user to a website
  • once arriving on the website, it would be obvious to the user whether or not the trade mark had any relation to the business of that website
  • as the metatag would only be discernible after reaching the website, and may have nothing to do with the website content, it couldn’t be used in that context as a badge of origin for the website services

INTERNET USE IN THE 21st CENTURY

Whilst previous cases found that the display of search results from one advertiser as a result of input of a competitors trade were likely to be misleading or deceptive, the Veda case thankfully catches up to the real world, accepting that internet users:

  • know the difference between Ads and organic search results
  • habitually scroll past the Ads in favour of organic search results
  • know advertisers are responsible for add content
  • know organic results are generated by website content
  • don’t expect companies placing Ads and companies with organic search results to be the same
  • actually look at URLs and understand which companies they are likely to be associated with

NOT MISLEADING IF THERE IS NO REPRESENTATION TO A CONSUMER

In looking at whether the display of advertising content without trade marks in search results was misleading and deceptive, the first question turned on whether or not a representation had been made.

Her Honour found that the choice of a keyword was a representation by the advertiser to Google, not to a consumer, and so can’t be misleading, particularly in the case where it isn’t even visible to the consumer.

Where Veda was used as a description in the Ad copy, Her Honour found that it was unlikely for internet users to be misled when the associated URL did not also contain the word Veda.

On the other hand, the ads containing the words “The Veda Report Centre” where found to be likely to misled or deceive the public due to their authoritative air.

GOOGLE’S RESPONSE?

Google had its own run in with the ACCC in 2012 over Adwords. The ACCC said that Google was participating in misleading and deceptive conduct by displaying sponsored links where the advertiser did not have a right to use trade marks which generated those sponsored links. One of the examples in that case was an ad for STA Travel that was displayed after entering the search terms “Harvey Travel” and “Harvey World Travel”.

Google was finally absolved of any wrongdoing in 2013 when the High Court unanimously decided that the words used to generate sponsored links were the responsibility of the advertisers and not Google. This placed Google in the same position as traditional advertisers like television, radio and print.

The Court decided that reasonable internet users were capable of telling the difference between ads and organic search results and would understand that Google itself wasn’t making any representations by displaying the ads.

In that case Google was able to demonstrate that when it had notice of a possible misrepresentation occurring if a particular keyword was used, it could stop an account holder from using that keyword. It might be for this reason that there has been a block on the use of a large number of trade marks in competitive advertising through Google Adwords.

How can Onyx Legal help you?

If you are concerned that someone is infringing your trade mark, or you have received a nasty letter saying that you are infringing someone else’s trade mark rights, let us know. 

We can help prepare a notice to another person letting them know they are infringing and asking them to stop it, or help you response to that type of letter. 

We can also help you assess whether any letter you receive is a legitimate risk to you or your business, or not. Claims from overseas are not always legitimate.

How to Deal with Threatening Legal Letters

How to Deal with Threatening Legal Letters

How to Deal with Threatening Legal Letters

Want to know how to handle nasty legal demands?

I’m on the road in between meetings today and just thought I’d share a story with you. I was speaking to a friend earlier and they said, “Oh, that’s such a great story. More people should know it.” So I thought I’d share it with you today.

We had a client who received one of those nasty letters of demand in the mail saying, “You’re in breach of our trade mark. Hand over your domain name, hand over your website. If you don’t do it in 24 hours or seven days or something ridiculous, then we’re going to take you to court and see you for a whole bunch of money.

Now the client came to us and said, “Can you represent me in court proceedings?” I responded, “Hey, let’s stop and look at this in the moment and see if that is your only option.

Court is not the only option

When we looked at the value in the client’s business, it was not in the trade mark. This is a client who had been selling a product that they imported from the UK and the company in the UK had registered the trade mark in the UK. There was a competing company in the US and they had registered the trade mark in the US. The American company came to Australia. They registered the trade mark in Australia. They waited a couple of years and then they wrote this nasty letter to our client saying, “You’re in breach of our trademark.” Our client had been trading in Australia before they started trading in Australia.

There are a whole lot of legal, technical arguments involved. We could’ve gone to court. We could have argued prior use and all sorts of things, but court proceedings take time and cost money. So the prospect of our client going to court was just not attractive. We were looking at maybe three years, $150,000 and no guarantee of a favourable result. We would have a result one way or the other, but we couldn’t guarantee it would help our client.

Looking at the business and knowing that the revenue wasn’t in the trade mark, we spoke to the supplier in the UK. They were happy to re-brand or they were already in the process of re-branding some of their products. So they said, “Okay, what we’ll do is we will assist you in re-branding.” They registered a domain name with the new brand. They registered the new brand as a trade mark here in Australia. Our client put together a 90 day plan, or at least we helped our client put together a 90 day plan to re-brand their business and to shift everything across to the new brand.

Because it was a 90 day plan and we made some promises to the American company about the process we were going to go through, they gave us that time because 90 days is a hell of a lot better than going through court, and there are certain requirements and rules around proper negotiation and all that sort of thing and trying to reach a commercial resolution. So the American company just had to wait.

Is there a better strategy?

In that 90 days, our client shifted his entire business onto the new brand. Now the value was in his database, so through a series of communications with the database, the whole database was shifted across to the new brand.

Our client did have to spend money on re-branding and shifting that database across, but he didn’t lose any revenue and most importantly didn’t lose any business. So once that process was complete, our client had a new website up. He had the entire database marketing to them and was changing them over to the new brand. We’ve got an agreement with the American company to say that we could sell out the end of the branded supply and not stock any new supply with that trade mark.

In the end, the American company bought our client’s domain name. Now, the reason behind that was the domain name was .com which means it can be used internationally, so my client still had the right to use that domain name in jurisdictions other than where there was a registered trade mark, or where he had permission. So he could still use it in the UK where they had the mark registered or his supplier had the registered trade mark and was happy for him to use it. In order for the American company to get hold of that domain, they had to buy it.

Instead of three years and $150,000 in court with no certain result, what we did is introduced a strategy enabling our client to re-brand in 90 days, shift his business across, not lose any money, and because the domain name was bought, his legal fees were effectively halved. So great, great result for the client, and just a really good example of the fact that there are options. Our client walked away with a stronger business and a protected brand.

  • Don’t think just because you get a letter of demand that you have no choice but to go to court.
  • Don’t think that you might not have an argument because there’s a whole lot of technical issues involved in legal cases, and sometimes it’s not all against you and sometimes there’s not all in your favour.
  • There are options and it’s worth investigating what those options are before you go and get started. 

How can Onyx Legal help you?

We’re interested in strategies that support you and your business to grow and get stronger. If you receive a nasty letter of demand and want help in figuring out how to respond, contact us to help you map the way forward.

Should you Register a Trade Mark?

Should you Register a Trade Mark?

Should you Register a Trade Mark?

Knowing When to Register a Trade Mark 

I’ve just been at a Angel Investor and Entrepreneur breakfast. One of the things we were talking about this morning was branding and looking at how to use your branding and how you might leverage your business and change the direction of your business in the future. So, whether or not you actually want to register trade marks now, what trade marks are worth registering? All of those sorts of questions came up.

One of the considerations that you can give before making a decision to register a trade mark or not is:

Where is the value in my business?

So, if the value is in the trade mark, then it’s worth registering. If the value is in some other aspect of the business, maybe you want to invest your money more in that first before you register a trade mark. Just something to think about.

Also, remember that not all things are capable of being registered as trade marks.

General descriptions and place names can’t be registered. We had a client once who said, “Hey, I want to register this trademark and it’s just been rejected by the trademark office. Can you tell me why?” The reason their application was rejected was because they wanted to register something like “Auto Sales, Brisbane“. It’s too generic. There’s no way you’re going to get that registered as a trade mark, because too many people in the same industry need to be able to use those words in that kind of order.

So just remember that not everything is capable of being registered as a trade mark and trade mark registration, although important, may not be your top priority right now.

How can Onyx Legal help you?

We can help you get your trade mark registered. We will help you identify the right classes and descriptions to protect your business and manage the process until your registration certificate comes through.